GBP/JPY nears 135.00 on Japan stimulus talk

Increased hopes of fresh Japanese fiscal stimulus strengthened the offered tone around JPY and pushed the GBP/JPY cross higher to 134.90 levels in Asia

Cross aiding correction in Cable

The upticks in the GBP/JPY cross helped the GBP/USD pair finally break above 1.30 handle in a convincing fashion. The pair clocked a high of 1.3090 in Asia.  

The cross strengthened on the second day after PM Abe signaled a fresh stimulus is on the way. Markets believe the fiscal stimulus is likely to be accompanied by more easing efforts from the Bank of Japan (BOJ). The increased hopes of a double barreled stimulus are keeping the Yen under pressure.

GBP/JPY Technical Levels

At the time of writing, the pair was trading at 134.75 levels. The immediate resistance is seen at 136.04 (23.6% of 160.12-128.60), above which the cross could target 139.01 (June 29 high). On the other hand, a breakdown of support at 133.21 (Brexit low) would expose 128.60 (July 6 low).